Exam 20: The Money Supply and Banking Systems

Leading up to the market meltdown of 2008,investors that purchased mortgage-backed securities (MBSs)also bought ________ to transfer the risk of those securities to someone else,in case those MBSs failed.

What is money? What are its four financial functions?

If you have reliable income,sufficient assets and a good credit history,you would likely qualify for a prime mortgage.

________ banking refers to a range of banking services for high-net-worth individuals and families,such as managing real estate and other investments.

________ are non-bank companies that use their own funds to offer mortgages.

________ refers to a situation in which a lender takes possession of a home after the borrower defaults on his or her mortgage payments.

Jackson Group,Inc.is an American multinational banking firm.It offers such services as stock market brokerage,underwriting,and initial public offering.Jackson Group is an example of a(n)________.

In response to the Great Depression,the ________ restricted investment banks and commercial banks from crossing into each other's businesses and potentially abusing their fiduciary duties at the expense of customers.

The prime rate is the interest rate that a bank charges its most credit-worthy customers.

The Federal Reserve requires all depository institutions (those that accept deposits from customers)to hold a portion of those deposits in reserve.

Which of the following federal actions is aimed at reducing the money supply in markets?

The Dodd-Frank Act includes the Volker rule,which ________.

________ helped fuel the housing bubble by expanding the secondary market for subprime loans.

Andrew has a low credit score and his home loan application was rejected by many banks.However,RS bank offers a home loan to him with loan-to-value at 80 percent.This loan is an example of a(n)________.

Money is anything generally accepted as a means of paying for goods and services.

The Dodd-Frank Act of 2010 is a legislation aimed at ________.

The federal funds rate is also known as the overnight rate.

Rhombus bank is a bank that focuses on home mortgages.The bank has 283 offices and has issued more than 0.1 million home loans to people with different income levels.The bank also accepts deposits to generate money for providing home loans.Rhombus bank is best referred to as a(n)________.

Money serves as a ________ when it is used as a way of accumulating wealth until it is needed.

Compare and contrast a liquidity crisis and a credit freeze.